Reeves eyes clampdown on salary sacrifice in latest stealth tax on high earners

The clampdown forms part of a wider fiscal tightening expected in Reeves’s first

Rachel Reeves is preparing to tighten the rules on salary sacrifice schemes in what would amount to a stealth tax raid on pension savings, as the chancellor searches for ways to fill a yawning £30bn black hole in public finances.

Reeves will use her November Budget to cap the amount that workers can pay into pensions through salary sacrifice schemes without incurring national insurance contributions, the Times reported, a move that could raise up to £2bn a year.

Currently, employees and employers avoid national insurance on income diverted into pensions through salary sacrifice arrangements.

But, under the new plans, that exemption would be capped at £2,000 per employee per year, meaning any further pensio